Nigerian Central Bank Governor and bitcoin critic Godwin Emefiele recently remarked that the rise of fintech and cryptocurrencies, among other technologies, has forced banks and financial institutions to change the way they operate. . According to Emefiele, this requires the central bank’s Monetary Policy Committee (MPC) to rethink how it regulates the financial system.
Rethinking the regulation of the financial system
Central Bank of Nigeria (CBN) Governor Godwin Emefiele has reportedly said the MPC, which was due to meet on July 18-19, must chart a new course that changes the direction of Nigeria’s monetary policy.
Speaking at a so-called MPC retreat, Emefiele said new technologies and innovations were playing an important role in Nigeria’s development. Therefore, future MPC decisions should seek to strengthen the contributions of these technologies.
Moreover, in his remarks published by Daily Nigerian, Emefiele – a bitcoin critic – argued that fintechs and cryptos have changed the way the financial system works and this calls for rethinking. He said:
Developments in fintech, cryptocurrencies, digital payments, artificial intelligence, and machine learning have changed the way the financial and banking industries operate, both globally and domestically. Hence the urgent call to rethink the regulation, supervision and implementation of monetary policy in the financial system.
Although new technologies and innovations are often associated with risks and uncertainties, Emefiele insisted that they also come with several benefits, including better access to financial services, poverty reduction and job creation.
Staying relevant in a changing world
Meanwhile, the Daily Nigerian report also quotes the CBN Governor urging MPC members to familiarize themselves with monetary policy tools and objectives that are relevant for a digitalized world.
“To ensure the relevance of monetary policy and the role of monetary authorities in the new digital world, MPC members must engage with [an] advanced level understanding of how digitalization interacts with monetary policy goals, targets and tools,” Emefiele reportedly said.
Regarding the MPC’s retirement, Emefiele said it was an important event as it gives the central bank an opportunity to assess its performance over the past three to four years.
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